Suppose that Gyp Sum Industries currently has the balance sheet shown as follows,and that sales for the year just ended were $20 million.The firm also has a profit margin of 22 percent,a retention ratio of 42 percent,and expects sales of $30 million next year.If all assets and current liabilities are expected to grow with sales,how much additional funds will Gyp Sum need from external sources to fund the expected growth?

A)$3,925,000
B)$3,695,000
C)$4,124,000
D)$4,478,000

Question

Suppose that Gyp Sum Industries currently has the balance sheet shown as follows,and that sales for the year just ended were $20 million.The firm also has a profit margin of 22 percent,a retention ratio of 42 percent,and expects sales of $30 million next year.If all assets and current liabilities are expected to grow with sales,how much additional funds will Gyp Sum need from external sources to fund the expected growth?

A)$3,925,000 
B)$3,695,000 
C)$4,124,000 
D)$4,478,000

Quizplus · Accepted Answer

The Answer of Suppose that Gyp Sum Industries currently has the balance sheet shown as follows,and that sales for the year just ended were $20 million.The firm also has a profit margin of 22 percent,a retention ratio of 42 percent,and expects sales of $30 million next year.If all assets and current liabilities are expected to grow with sales,how much additional funds will Gyp Sum need from external sources to fund the expected growth?

A)$3,925,000 
B)$3,695,000 
C)$4,124,000 
D)$4,478,000

Suppose That Gyp Sum Industries Currently Has the Balance Sheet